Value

In lean (Toyota Production System), value is defined by the customer. To be considered value adding, an activity must meet a high standard: Does it change the form, fit, or function toward customer needs or wants, and is it done correctly the first time (rework is never value adding)? In healthcare, we’ve also added “feeling,” as a patient moves from concerned to reassured. An equivalent question is: Would the customer pay for this activity? 1

Here’s a customer’s perspective on value: When my three-year old nephew comes to visit, he wants me to make my chocolate chip cookies – warm and fresh out of the oven. My process is to gather the ingredients (including running to the store for chocolate chips), measure, mix, drop the dough on the cookie sheet, and wait while the cookies bake. Finally, a warm cookie is delivered! From my nephew’s perspective, the value is his request being heard and the cookie being delivered to his hands. He doesn’t want to wait or pay for me to run to the store because I didn’t have the supplies I needed. His definition of value is much narrower than the effort I made. Why is it important to understand the customer’s definition of value? Understanding value from the customer’s perspective helps us understand which activities should be evaluated for improvement. For example, I could ensure I don’t run out of ingredients. Or, when I know he’s visiting, I could pre-mix the cookie dough. Or, I could use a convection oven to bake the cookies faster. These improvements would facilitate warm cookies being in my nephew’s hands sooner.

A cross-functional team was struggling with the definition of value as they considered the process of registering patients at the hospital for outpatient surgery. They knew patients valued the surgery, but did patients value the registration process? It was a tough decision, but the team decided that registration wasn’t value adding, but it was necessary. With this new perspective, the team evaluated how much of the registration process could be improved. They realized that two teams were duplicating effort. The local and central registration offices were both registering the same patient for the same surgery. Digging deeper, they learned the rework was because they didn’t have a clear definition of quality for the registration – they fixed this! The new process was for the central office to enter the registration and the local office to audit. There were a few minor issues, which the team collaborated on to resolve. Over time, they reduced the amount of auditing since, by definition, it’s non-value adding. The benefits included freeing up the local registrar, which enabled patients to be registered faster for the emergency department. And the registrar was so much happier doing work that wasn’t duplicative.

Another challenge when defining value (which can have gray areas) is assuming that we have to know a better way to do something before we flag an activity as non-value adding. For example, when I worked in manufacturing, we had a vitamin B12 test that required boiling. Customers told us they didn’t value this step – yet we assumed it was value adding because we didn’t know any other way to break down the proteins in order to measure the B12. We challenged ourselves to accept that our process wasn’t 100% value adding, and to find another way to break down the proteins. We developed a microwaving option, which was faster and eliminated dripping hot water on the floor. By challenging our thinking about value—yes, boiling changed the form, but no, customers didn’t want to pay for this (in time and mess)—we identified an improvement opportunity and we pushed our knowledge forward and built a more value-adding process for our customers.

When considering the question of value for a customer, I’ve found it helpful to:

Understand who the customer is.

Consider the service being provided.

Think about individual tasks versus the entire service.

Identifying something as non-value adding isn’t a judgment on the person or the process, just a helpful hint on where to start our journey of making services and products leaner and more customer focused. It’s extremely difficult (maybe impossible) to build a process that is 100% value adding – every activity, every time. It’s an aspirational goal that enables us to challenge ourselves to increase the value in our work.